Sure, the "reasonable person" would be a competitor who generally follows standard operating procedures. If they're lagging behind the industry in safety or something, that's evidence of criminal negligence.
And yes, the C-suite should absolutely be the first to look at, but the problem could very well come from someone in the middle trying to make their department look better than it is and lying to the C-suites. C-suites have a fiduciary responsibility to the shareholders, whereas their reports don't, so they can have very different motivations.